The internal market and national security: transposition, impact and reform of the EU Directive on Intra-Community Transfers of Defence Products

Whilst the Internal Market has been operational for decades, the free movement of defence products within the EU has been restricted by national licensing practices. Member States have treated “intra-EU” transfers as equivalent to third country exports. The Intra-Community Transfers Directive (ICT) introduced a harmonized transfer regime. This article provides a first legal analysis and a case study of the challenges facing harmonization where an evolving Internal Market competence meets a diversity of national security and other interests. The ICT constitutes a significant first step towards reducing barriers to trade, but an ambivalent approach to minimum harmonization has impacted its effectiveness; legal reform is required to further this objective.